Ryder acquires MXD Group in push into last-mile heavy-goods delivery

Ryder System Inc. jumped into the fast-growing market for last mile deliveries of heavy goods by acquiring The MXD Group Inc., an omnichannel fulfillment provider with a strong last-mile delivery presence, for $120 million.

New Albany, Ohio-based MXD, which is a non-asset-based provider and relies on a network of contractors to provide delivery services, will be absorbed into Miami-based Ryder's operations. MXD has 109 e-commerce fulfillment facilities across the U.S. and Canada, including 21 company-operated cross dock hubs, 16 dedicated operations, and 72 third-party agent facilities. Ryder, which had only 12 fulfillment facilities in the U.S. and Canada, will now cover 95 percent of the two countries' geographies within two days, it said.

The MXD acquisition makes Ryder the second-largest provider of last-mile deliveries of heavy goods behind Greenwich, Conn.-based XPO Logistics Inc. The market hit $8.1 billion in 2017, a 9.6 percent increase over 2016, according to SJ Consulting, a consulting firm. Demand is expected to steadily increase as more retailers throw open their entire inventories to online ordering and customers feel more comfortable ordering big, bulky items via the Internet.

Most last-mile deliveries are generated by online orders and are composed of small parcels. By contrast, the heavy goods segment often requires more than one delivery person, entry inside the home, office or business, and installation of the product.